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Five Lessons Ad Agencies Can Learn From Hollywood

As the rules for media monetization continue to be rewritten, Hollywood and Madison Avenue (once good neighbors) are each looking for ways to expand into the other’s turf. Unfortunately for advertising agencies, the entertainment industry is currently better positioned to do advertising than advertisers are to do entertainment.

Here are five things agencies can do to change this dynamic.

Make More of Less

Agencies are traditionally structured to create one-off campaigns that appeal to very broad, singular demographics. Creative departments may toil for a year or more over a single campaign idea. As the marketing landscape shifts, requiring brands to deliver large amounts of hyper-targeted content, agencies will need to deliver large volumes of quality content.

Envision the agency creative department evolving from two person ideation teams of copywriters and art directors that pass ideas up a hierarchical chain to small nimble packs that can go out into the world and concept, shoot, edit, compose and even write code. Production tools are now cheap and accessible and young creative professionals tend to be more multi-faceted and less specialized, allowing a small team to deliver soup-to-nuts content ready for online consumption.

Empower the Producer

The Hollywood model used to be one of vertical integration where actors, directors, writers and producers were employed by a single studio. Now it resembles a loosely connected, open marketplace where producers form specialized teams around creative projects.

As the advertising ecosystem begins to undergo a similar evolution—moving from retainer-based relationships to project-based relationships—agencies should reevaluate the role of producers.

In advertising, the producer sits at the end of the process. In entertainment they lead it. Hollywood producers are respected as being creative, as well as being able to get things done. They are capable of overseeing a larger volume of outputs by curating good ideas (regardless of where they originate) and packaging them with the proper executional teams.

There’s no reason a creative director and a producer need to be separate roles.

Get Skin in the Game

In entertainment, as every aspiring filmmaker knows, there is no paycheck for an idea. The (real) money comes when something is made and then accepted by the marketplace.

This means that in Hollywood, everyone is an entrepreneur. It also means the industry inherently understands that while the reward for a hit is massive, that hit also needs to fuel what are inevitably many misses. As a service business based on billable hours and retainers, agencies don’t take that risk of failure, nor do they benefit from the (potentially massive) upside of success.

A legendary example of this is Space Jam, a concept that came from Nike’s agency Wieden + Kennedy. While well compensated for the original ad, the agency never benefited from the licensing or movie deals that went on to earn Warner Brothers billions.

Embracing the entrepreneurial gene requires happily accepting a smaller fee for services in order to participate in the “back-end,” therefore accessing new revenue streams that include merchandising, subscription, etc.

Consider the Bigger Picture

Agency folks often hear that brand messages should be integrated into a great story versus interrupting a great story. Unfortunately, agency writers are trained to produce 30-second segments, and these highly creative people tend to be a fish out of water when working in longer formats.

To truly integrate rather than interrupt, agencies need to begin investing in partnerships with long form, episodic storytellers. This doesn’t mean staffing agency broadcast departments with TV writers, it means letting the agency focus on what they do best – brand stewardship – and partner with best in class production companies to do the rest. It means giving up some creative control in order to get a better end product. Account and client management might not sound sexy, but it’s an integral and nuanced language that Hollywood doesn’t speak and it’s a true value that an advertising agency can deliver regardless of format.

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